Chronic vessels shortage seems baked in to offshore wind’s future

Picking through some of the past year’s headlines regarding the state of the offshore wind construction and support vessels market makes uncomfortable reading.

It boils down to a déjà vu replay of the chronic shortages that have bedevilled offshore oil and gas for decades. And yet the industry has still managed to do its business r

Here’s a taster of this year’s coverage in the offshore wind context:

11 Jan 2023 – Energy Voice: A major pitfall is starting to become more apparent; a lack of vessels capable of transporting and installing offshore wind turbines.

12 Jun – Eastern Daily Press: Offshore wind installation bottlenecks could hit from 2024 as heavy lift vessel demand dramatically outweighs supply.

26 Jun – Recharge headline: The ’19-vessel gap’ threatening global offshore wind targets … it is the shortage of high-capacity vessels for installing foundations and turbines that are emerging as the most critical threat to expansion plans.

16 Oct – Linkedin: The offshore wind sector is presently grappling with a myriad of challenges, one of the most critical being the lack of suitable vessels for … etc, etc.

Nov 3 – Reuters: Danish energy firm Orsted’s shock decision to cancel two offshore wind farms off New Jersey this week was based in large part on big delays securing the ship it needed to build the project, company officials said.

Offshore wind is building out at a breathtaking pace, but it will have to shift at breakneck speed if the COP28 ambition of tripling global renewables capacity by 2030.

There is tonnage on order and in-build, including offshore construction/installation vessel tonnage. But not enough.

However, don’t forget that the pace at which new tonnage can be invested in is largely dependent upon the ability of operators and companies in the supply chain to finance directly and through borrowing against future opportunities.

Of course, in some countries, notably China, the state has the power to step in and finance a fleet build programme, assuming sufficient specialist yard capacity.

And that is perhaps increasingly hard to compute as owners of the global merchant vessel fleet … mostly containerships, tankers and dry bulkers … wake to their obligations to decarbonise.

What won’t happen is that the renewables industry will be panicked into action because of the relentlessly grim headlines such as those above.

Judging by the latest deliveries of and orders for offshore wind vessels, the industry always appears to be playing catch-up. There isn’t enough tonnage for day-to-day operations of completed windfarms; let alone cable layers where shortages are even more chronic than for vessels able to install the turbines themselves.

Market swings don’t help

© Supplied by Megamas Resources

In June, UK maritime intelligence house Clarkson’s Research optimistically forecast that offshore wind ship orders could hit $7.8bn this year.

But four or so months later, that market had changed, Clarkson’s optimism had vanished, with 77 vessels ordered representing an investment of $2.3bn, way short of last year’s record of $6.1bn. WTIV orders looked paltry compared with 2023’s total of 28 WTIVs booked.

Until the advent of offshore wind, the global fleet of cable-layers was always relatively limited; some were dedicated to international subsea communications networks, plus relatively few others dedicated to the offshore oil & gas industry’s requirements.

Offshore wind has dramatically changed the subsea cables market and a game of catch-up is evident.

Checking out some of the latest new orders log/newsletter, we note the following:

Nov 6: Clarkson’s Research reported that Singapore-based Megamas Resources in partnership with Renaissance Technologies (RTM) had contracted Ulstein for the design of a cable laying and repair vessel. Megamas is targeting two new-builds; the first to be ready for service early 2026.

Nov 22: The Maritime Executive recorded that Mitsui OSK Lines of Japan has ordered a second wind farm service vessel. Like the first delivered in 2022, it will be built in Vietnam by Damen of Holland with delivery due in 2025.

12 Dec: Vard of Norway to build cable-lay vessel for Toyo Construction (Japan). Newbuild will mainly support the construction of offshore wind farms in Japanese waters.

14 Dec: IWS of Norway takes delivery of a CSOV (wind farm mothership) for North Sea service. Chinese-built IWS Windwalker is the second of six sisters and will start work on the Dogger Bank wind farm early this year. The first, IWS Skywalker, is already in service.

18 Dec: Vard awarded another contract for a cable layer for an undisclosed client. It is due to be delivered in Q4 2026.